In an announcement that will provide some measure of relief for T-bill traders and others who are skeptical about Republican lawmakers' ability to compromise with their Democratic colleagues, the Republican House leadership said Tuesday they would bring a stopgap bill to extend funding at its current levels - and preserve funding for a popular child health-care program - until Dec. 22. Otherwise, the current continuing resolution would expire on Friday, tilting the federal government into its first shutdown since 2013.
The compromise leaves much to be desired, however, and a workable, long-term spending compromise will unlikely be reached, which is making markets nervous. As we reported yesterday, the T-bill market has once again been under pressure, with the Dec 14 Bill the traders' focus for now:
Lawamakers' unwillingness to compromise on this bill, however, is due to one policy demand that Democrats have staked their political future on, but Republicans see as tantamount to amnesty: Enshrining DACA, or DREAM Act, protections into law.
The deal look ready to go in Setember when Trump annoounced he'd struck a deal with "Chuck and Nancy" to pass a continuing resolution in exchange for a series of Democratic compromises on imigration enforcement while Trump would fight to push Congress to authorize the DACA privileges. Trump had canceled an executive order granting those protections earlier this year.
However, a few weeks later, Trump went back on his word, proposing that the final legislation include funding for his border wall - something Democrats had never agreed to. Meanwhile, some Republicans have taken a hard line on the DACA protections, saying there's "no way" they'd be included in a spending bill before the end of the year. More from Bloomberg:
John Cornyn of Texas, the Senate’s No. 2 Republican leader, said Monday that talks with Senate Democrats over combining new border security measures and deportation protections are at an impasse. Cornyn said he sees little chance for resolution before the year is over, pushing the matter into early 2018.
He also told reporters that “no way” would he back combining such a package with a must-pass year-end spending deal designed to keep the government open, a key demand of Democrats to get their needed support to move it through the Senate.
Speaking on the Senate floor, he accused Democrats of a “hysterical and cynical ploy” of threatening to trigger a shutdown over the matter. Republicans are angling for a two-week stop-gap measure to get past a Dec. 8 deadline when agency spending authority lapses, with the potential for a second such measure later in the month that extends into January. Democrats haven’t agreed to those terms.
Widening the divide, many powerful Democrats are demanding these protections be enshrined in law by the end of the year.
Senator Richard Durbin of Illinois, the No. 2 Democratic leader, said later that he continues to insist that Congress act this year to address the needs of the young immigrants, brought to the U.S. by their parents when they were children. Their deportation protections were put in place by President Barack Obama and temporarily extended by Trump until early March. Ending them will affect 1,000 young people each day over two years if the deadline is reached, Durbin said.
“I want it done this year,” Durbin said. “This calendar year.”
At least one Republican who’s in favor of keeping the protections has said it’s possible they pass by the end f the year – just not as part of the bill to reauthorize spending.
The protection for the those covered by Obama’s Deferred Action for Childhood Arrivals program, or DACA, has been up in the air throughout the first year of Trump’s presidency. Trump in September agreed with Senate Minority Leader Chuck Schumer of New York and House Minority Leader Nancy Pelosi of California to move a border security bill by year’s end, and pair it with protections for the immigrants. He has since backed away from it.
A Senate Democratic aide familiar with the negotiations said that Republicans proposed a plan for a dramatic increase for border resources, some cuts to the number of legal immigrants and only temporary protections for the young immigrants. Durbin put forth a counter proposal with more modest border resources, combined with a permanent DACA fix and a pathway to citizenship for the immigrants.
Given the rancor these negotiations have instilled in both Democrats and Republicans, it’s also unlikely the two sides will be able to compromise on issues like preserving Obamacare subsidies, funding for Planned Parenthood and disaster relief spending.
For now, at least, Republicans have cobbled together a stopgap - though it's still unclear if this will have the votes to pass the senate. The plan maintains the current federal spending levels but includes a provision to ensure that states are not forced to suspend the popular Children's Health Insurance Program, which annually provides health insurance for nearly 9 million children in low-income families.
"This bill, one without any controversial policy riders, will continue government funding and give the House and Senate time to complete their work on a long-term solution," McConnell said on the Senate floor Monday.
"It will keep the government open and functional, and it includes critical resources for our national defense and to give states certainty to continue the Children's Health Insurance Program while the bipartisan work on CHIP reauthorization continues," he added.
McConnell summarized the republican position best, noting that that Congress has until March before those covered by the Deferred Action for Childhood Arrivals (DACA) program lose protections from the program President Trump is ending.
“I don’t think the Democrats would be very smart to say they want to shut down the government over a nonemergency,” McConnell said on ABC’s “This Week.”
Of course, the Democrats will claim that it is an emergency, and certainly a worthy cause for government shutdown, just as Trump enjoyed his biggest legislative victory to date.
As the Hill pointed out, Pelosi and Schumer said in a statement accepting an invitation to meet at the White House on Thursday that a “bipartisan deal” could be found to pass the “DREAM Act along with tough border security measures.”
“There is a bipartisan path forward on all of these items,” the two said in the statement, which also emphasized the need to boost defense and nondefense spending and provide disaster relief.
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Meanwhile, on Tuesday morning, as touched upon up top, the House Republican leadership said it was forging ahead with a stop-gap bill to keep the government funded through Dec. 22 and avoid a shutdown, despite a Monday night push from the conservative Freedom Caucus to move the date past Christmas. Lawmakers emerged from a House GOP conference meeting on Tuesday morning indicating that leaders are leaning toward a two-week continuing resolution (CR).
“Leadership is locked in on Dec. 22,” Freedom Caucus Rep. Andy Biggs (R-Ariz.) told The Hill.
The Freedom Caucus had protested the strategy and held up a vote on a motion to go conference with the Senate on tax legislation Monday night until they got assurances from leadership that they would consider a longer CR. But leaders appear to be sticking with their original plan.
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Still, the question remains: How long can lawmakers keep doing this before they get tired of pretending they have some deal in the worlds, and realize that a permanent solution is impossible and usher in the first shutdown since 2013?